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Protective Reports First Quarter 2014 Financial Results

Protective Life Corporation (NYSE: PL) (“the Company”) today reported results for the first quarter of 2014. Net income for the first quarter of 2014 was $83.6 million or $1.03 per average diluted share, compared to $78.3 million or $0.97 per average diluted share in the first quarter of 2013. After-tax operating income was $96.5 million or $1.19 per average diluted share, compared to $71.4 million or $0.89 per average diluted share in the first quarter of 2013.

“We are pleased to report solid results across all segments in the first quarter,” said John D. Johns, Chairman, President, and CEO. “Operating earnings of $1.19 per share were up 34% over the first quarter of 2013 and exceeded our plan for the quarter by $.07 per share. Strong results in the Annuity and Stable Value lines offset the impact of unfavorable mortality in Life Marketing, Acquisitions and Annuities. While sales in Life Marketing and Annuities were below plan in the quarter, our recent sales trends have improved and we expect to see sales revert to plan as the year progresses. The MONY acquisition integration plan is on track, and the Acquisition segment reported record earnings of $61.0 million, including a strong contribution from the MONY blocks. We are off to a strong start in 2014, and we remain confident in our ability to achieve or exceed our plans for the year.”

Business Segment Results

The table below sets forth business segment operating income (loss) before income tax for the periods shown:

                             
Operating Income (Loss) Before Income Tax
($ in thousands) $ %
  1Q14     1Q13     Change     Change  
Life Marketing $ 23,485 $ 23,707 $ (222 ) (1 )%
Acquisitions 60,996 34,377 26,619 77
Annuities 51,643 43,398 8,245 19
Stable Value Products 17,397 17,844 (447 ) (3 )
Asset Protection 6,369 6,081 288 5
Corporate & Other     (14,855 )       (18,332 )       3,477     19
  $ 145,035       $ 107,075       $ 37,960     35
 

The following table reconciles segment operating income to consolidated net income:

             
($ in thousands)
  1Q14     1Q13  
Operating income before income tax

$

145,035

$

107,075
Realized investment gains (losses) (17,840 ) 11,579
Less:

Amortization of deferred policy acquisition costs, value of business acquired, and benefits and settlement expenses

1,990 1,027
Income tax expense     41,566         39,336  
Net income  

$

83,639      

$

78,291  
 

Sales

The Company uses sales statistics to measure the relative progress of its marketing efforts. The Company derives these statistics from various sales tracking and administrative systems and not from its financial reporting systems or financial statements. These statistics measure only one of many factors that may affect future profitability of the business segments and therefore are not intended to be predictive of future profitability.

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